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Mortgage Lenders Profitability Outlook Tightens Further Following 2020 Refi Boom
Surveyed Lenders Report Uptick in Purchase Mortgage Demand, Downtick in Refinance Demand
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WASHINGTON, June 10, 2021 /PRNewswire/ For the third consecutive quarter, an increased share of mortgage lenders expect profit margins to retreat further from last year s highs, according to Fannie Mae s (OTCQB: FNMA) Q2 2021 Mortgage Lender Sentiment Survey
® (MLSS). According to the second quarter survey, 69% of lenders believe profit margins will decrease in the three months ahead compared to 52% in the prior quarter, while 19% believe profits will remain the same and 11% believe profits will increase.
Economy Expected to Heat Up Through the Summer as Inflation Risks Mount
Expectations for full-year 2021 economic growth were revised upward in May to 7.0 percent, a modest improvement from last month’s projection of 6.8 percent, attributable primarily to stronger-than-expected first quarter real GDP growth and an improved near-term outlook for consumer spending, according to the May 2021 commentary from the Fannie Mae (OTCQB: FNMA) Economic and Strategic Research (ESR) Group. The additional strength in consumer spending was previously projected to occur later in 2021 or early 2022, but recent incoming data increasingly points to eagerness on the part of consumers amid continued progress mobilizing COVID-19 vaccinations and waning virus-related restrictions. With stronger growth expected in the current year, the ESR Group slightly downgraded its expectations for 2022 real GDP growth by 0.2 percentage points to 2.8 percent. Despite expectations that the economy will continue to grow
Housing Sentiment Jumps on Consumers Selling and Personal Finance Optimism
Sixty-One Percent of Respondents Believe It s a Good Time to Sell a Home
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® (HPSI) increased in March by 5.2 points to 81.7. Four of the HPSI s six components increased month over month, including the components related to homebuying and home-selling conditions, household income, and home prices. The mortgage rate outlook component experienced the only decline; and the latest results indicate that only 6% of consumers believe that mortgage rates will decrease over the next 12 months. Year over year, the HPSI is up 0.9 points. The significant increase in the HPSI in March reflects consumer optimism toward the housing market and larger economy as vaccinations continue to roll out, a third round of stimulus checks was distributed, and the spring homebuying season began – perhaps with even more intensity this year, since 2020 s spring homebuying season was limited by vi
People Are Finally Starting to Think About Selling Homes Instead of Just Buying Them Apr 7 2021, 2:12PM
Consumer attitudes perked up in March, sending the
Fannie Mae Home Purchase Sentiment Index (HPSI) up 5.2 points compared to
February. The company said four of the HPSI s components rose during the month,
taking the index to 81.7.
The percentage of respondents who
say it is a good time to buy a home rose to 53 percent from 48 percent and
there was a 3 point decline in those who viewed the timing as bad. This left a
net of 13 points, an increase of 8 points for the month but 7 points below the